How does Exchange server 2003 store email?

If you send email to an Exchange server distribution group, does the Exchange server make multiple copies of the same email and sends one copy to each recipient's mailbox? Or, does the server store the original email (and make no copies), which is referenced by each member of the group? It makes sense to me that Exchange will do the latter to save space. Is this a correct assumption? Thanks.

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I'm not 100% certain about distribution groups, but the Information store uses Single-instance message storage for each message store, as described below. It is my belief that distribution groups work the same way, as they are simply a group of users on that Exchange server. There should be a single message ID created with ACLs per user that is permitted to view the message. When users "delete" the message, they are effectively removing themselves to access the message via changing the ACL (Exchange controls it). Once the last person "deletes" the message, it is removed from the storage group during a normal IS maintenance schedule.
Extracted from: http://www.msexchange.org/articles/Understanding-Exchange-Information-Store.html
Exchange utilizes what Microsoft terms a single-instance message store. This single-instance message store works on a per database basis. What does this mean? If an e-mail message is sent to multiple mailboxes that are all in the same database, the message is stored once and each mailbox has a pointer to the message. The transaction is also logged in the transaction logs for the Storage Group that contains the database. However, if the e-mail message is sent to multiple mailboxes that are located in different databases, the message is copied to each database and written to the transaction logs for each Storage Group that contains the database with a copy of the message.

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